Shipper Moller-Maersk returns to full-year profit

Shipper Moller-Maersk returns to full-year profit

February 23rd, 2011by JAN M. OLSEN, Associated Press
in News

COPENHAGEN, Denmark (AP) - Danish container shipping and oil group A.P. Moller-Maersk A/S said Wednesday it returned to a profit last year, citing a recovery in world trade flows and higher oil prices.

The company posted a net profit of 26.5 billion kroner ($4.84 billion) in 2010, compared with a loss of 7.0 billion kroner in the previous year, when the shipping industry suffered from the severe economic downturn.

Higher freight rates and volumes in its container activities helped boost Maersk's revenue to 315.4 billion kroner from 260 billion kroner in 2009. The company does not release a quarterly breakdown of its results.

"There has been a turnaround in the container business where they have started to focus more on the moneymaking parts," Sydbank analyst Jacob Pedersen said.

CEO Nils Smedegaard Andersen said that despite market improvements in 2010, container rates and volumes were still only on par with 2008. "This means that the significant profit improvements stem from our own efforts to become more competitive," Smedegaard Andersen said.

The company said global demand for seaborne containers is expected to grow by 6-8 percent in 2011.

Moller-Maersk wants to win back the market share it lost in 2010, "not through rate dumping, but by delivering a superior product as regards reliability, availability and customer service," Smedegaard Andersen said.

On Monday, the group signed a $1.9 billion contract for 10 giant container vessels with an option for 20 more. The ships, expected to be the largest of any known type of ship in operation, would be built by South Korea's Daewoo Shipbuilding & Marine Engineering.